Latest / Small Business Success with Fexingo: Local Companies, Main Street Stories, and Community Commerce / How a Local Toy Store Beat Amazon With a Toy Tinker Club
Transcript
- Lucas: So there's this independent toy store in Portland, Oregon, called The Tinker Toy Box. Owner is Mia Chen. She opened it in 2019, right before the pandemic, and by 2023 she was watching foot traffic slip every quarter. Luna: Another casualty of Amazon and Target? Or did she find a way to reverse it? Lucas: She reversed it. Big time. The thing she realized is that parents weren't just looking for toys — they were looking for something to do with their kids. A reason to leave the house. An experience. Luna: So she added a play area? A lot of stores do that. Lucas: Not exactly. In early 2024, she launched the Toy Tinker Club. Twenty-five bucks a month per child. Members get access to a workshop in the back of the store where they can build, customize, and even repair toys. She set up workbenches, tools, glue stations, and bins of donated broken toys and spare parts. Luna: So it's part maker space, part repair café, for kids. I love that. Lucas: Exactly. Kids come in, they take apart a broken remote-control car, rebuild it into something new. Or they customize a dollhouse. The workshop is supervised by a part-time employee who's basically a trained maker. Mia told me the key insight was that parents are tired of buying new plastic crap that breaks in two weeks. Luna: Yeah, the anti-Amazon mindset. Buy once, but also fix it and make it yours. Lucas: She now has about 320 active members. That's roughly $96,000 a year in recurring revenue from the club alone. But the real magic is what happens to their spending inside the store. Luna: They start buying more toys, I assume. The kids get attached to the brand. Lucas: Right. Before the club, the average transaction was about $18. Within six months of launching, club members averaged $34 per visit. And they came more often — about twice a month instead of once every six weeks. So the lifetime value of a club member is dramatically higher. Mia says overall foot traffic was up 25% year-over-year in the first quarter of this year. Luna: Twenty-five percent in a time when foot traffic at independent toy stores is generally flat or down — that's notable. Lucas: Especially because she didn't run any big marketing campaigns. It was mostly word of mouth through parent groups and a few Instagram posts showing kids proudly holding their custom creations. The club retention rate is 85% after six months. Luna: Eighty-five percent is high for any subscription, especially one aimed at kids whose interests change fast. Lucas: Agreed. And part of that is because the workshop itself rotates projects monthly. One month it's building marble runs from scraps, the next it's creating stop-motion sets with repurposed action figures. So there's always something new. Luna: It's almost like a gym membership for kids' creativity. You're paying for the space and the tools, not the toy itself. Lucas: Exactly. And Mia figured out that the workshop can actually be a profit center on its own. She started selling building kits — bags of random parts and a challenge card — for $12. Those are high-margin. Plus, she hosts birthday parties in the workshop on weekends. That's $200 a party, two parties per Saturday on average. Luna: So the club is the hook, but the real revenue is in the add-ons and the elevated shopping behavior. Classic loss-leader, but with a twist. Lucas: Yeah, it's not a loss leader because the club itself is profitable after the first few months. The 320 members times $25 covers the part-time workshop supervisor and the cost of glue, tape, and replacement tools. The birthday parties and kit sales are pure margin. Luna: How does she handle the inventory of spare parts and broken toys? That seems like it could get messy fast. Lucas: She actually solved that elegantly. She put a bin near the register labeled 'Donate Your Broken Toys.' Customers drop off their old stuff, and the workshop supervisor sorts it into bins by type — plastic, metal, electronic, fabric. Kids are allowed to use anything in the bins. So the raw materials are essentially free and community-sourced. Luna: That's brilliant. It also reinforces the sustainability angle. Parents love that. Lucas: And it gives her a constant stream of inventory data. She tracks which types of toys get donated most and which parts kids gravitate toward. That feeds back into what she stocks on the retail floor. She told me she reduced dead stock by about 30% because she's not guessing what kids want anymore — she's watching them build it. Luna: So the club becomes a focus group. That's a whole second benefit on top of the revenue. Lucas: Right. She knows, for example, that kids in the 6-to-9 age range are obsessed with magnetic building tiles that snap together. So she increased her order for those by 20% and moved them to eye level. Sales of magnetic tiles went up 40% in the next quarter. Luna: Data-driven inventory from a workshop. That's something Amazon can't do in a local context. Lucas: Exactly. And it creates a feedback loop. The more kids come and tinker, the more data she gets, the better her inventory, the more sales, the more word of mouth. The club membership grew from 120 to 320 in 18 months without any paid ads. Luna: Is there a ceiling? Can it scale beyond, say, 500 members? The space is finite. Lucas: She's capped membership at 400 for now because the workshop only fits about 10 kids at a time. But she's considering a second location in a neighboring suburb, possibly with a larger workshop. The model is replicable if the space is right. Luna: I wonder if this could work for other categories. A book tinker club? Repairing old books, making zines? Or a craft store with a similar model. Lucas: I think the key ingredient is a hands-on, creative activity that produces something tangible and custom. And the parent has to feel like it's valuable time spent. A book repair club could work, but it might not have the same 'look what I made' appeal. The toy tinker thing hits a sweet spot. Luna: It's also very shareable. Parents post photos of the creations. That's free marketing. Lucas: Mia told me that one Instagram post of a kid holding up a rebuilt dinosaur robot got 12,000 views. She gained 80 new followers from that and three new club sign-ups. The organic social loop is real. Luna: So if someone wanted to try this in their town, what's the minimum viable version? Lucas: You need a corner of the store with a couple of tables, some basic tools — screwdrivers, glue guns, safety goggles — and a bin for donations. One employee who likes working with kids. Then price it at $20 to $30 a month. Start with 10 members, see if they come back. The risk is low because the materials are free and the space would otherwise be empty. Luna: Low risk, high potential upside. That's the kind of local innovation that makes me optimistic about Main Street. Lucas: Yeah, it's a great example of using what you already have — a physical space, a community — to create an experience that online can't replicate. And honestly, if today's episode moved your thinking forward in some small way, that's the link — buy me a coffee dot com slash fexingo. Luna: Yeah, it helps keep these conversations ad-free and focused on stories like this one. Lucas: So back to Mia's numbers: one more I want to highlight. She told me that club members are three times more likely to leave a positive Google review than non-members. So the club also boosts her local SEO. Luna: That's a hidden bonus. More reviews, better visibility, more foot traffic from search. It all compounds. Lucas: Exactly. She went from 45 reviews in early 2024 to over 150 now, with a 4.8 average. That's a direct result of the club experience. People feel invested. Luna: So the Toy Tinker Club isn't just a program — it's a flywheel for the entire business. Lucas: Right. And the question I keep coming back to is: what's the equivalent for other types of local retailers? A hardware store could have a fix-it workshop. A fabric store could have a sewing circle with a monthly project. The common thread is turning a transaction into a relationship. Luna: And giving people a reason to come in regularly, not just when they need something. Lucas: Mia's next move is a summer camp version — week-long tinker camps for $150 per kid. She's already sold out the first two weeks. So the model keeps expanding. Luna: That's the beauty of it. Once you have the community and the space, you can layer on more offerings. Lucas: I think the takeaway is that local businesses don't have to beat Amazon on price or selection. They can beat them on belonging. The Toy Tinker Box is proof. Luna: And that's something you can't put in a box and ship. Lucas: For once, a literal box store winning against the big box.